Samsung says next year's LCD sales will rise 40%

BLOOMBERG

Samsung Electronics Co, the world's largest maker of liquid-crystal displays (LCDs), said sales from the business will increase 40 percent next year as demand surges for flat-screen televisions and computer monitors.

Samsung's LCD sales will rise to US$7 billion, from US$5 billion this year, executive vice president Kim Sang Soo told reporters at a briefing in Seoul.

Prices won't fall next year because demand will outstrip the industry's production capacity, Kim said.

The forecast may ease concerns that a surge in production of flat panels by Samsung and rivals such as LG Philips LCD Co and Taiwan's AU Optronics (友達光電) Corp could cause prices to decline.

Screen-makers have increased spending on plants as they vie for leadership of a LCD TV market that's forecast to grow to US$19.7 billion by 2007, according to researcher DisplaySearch.

"Given the strong LCD prices, I don't think Samsung's sales forecast is out of the question," said Jay Kim, an analyst at Hyundai Securities, who has a `buy' rating on Samsung shares. "Supply will be tight at least until the first quarter."

The company has said it can't meet all the orders it's receiving for LCD screens, which are rapidly replacing bulky glass-tube based monitors and TVs on desktops and in living rooms.

Samsung said it aims to raise its share of the global LCD market to 25 percent next year from about 22 percent this year as a new plant become fully operational.

The so-called fifth-generation factory uses bigger glass sheets from which to cut screens, helping to reduce production costs.

"With the growth in production, I think we can achieve that target," said Cho Yeong Duk, vice president at Samsung's strategic planning team.

The global market for large-sized LCD screens, measuring at least 40 inches diagonally, will grow to 120.5 million units next year from 92.2 million this year, Samsung said in a statement.

The company said today it developed panels for televisions with 57-inch screens, which it claims are the world's largest.

"I'm confident that flat panels with screen size of 40 inches and more will be the main product in this industry in the near future," Kim told reporters.